Brazil Weighs Reciprocal Trade Measures After New U.S. Tariffs

Brazil’s government is considering whether to use a new reciprocity law against the United States after President Donald Trump imposed a 25% tariff on Brazilian products, according to O Globo.

The administration of President Luiz Inacio Lula da Silva recognizes that Washington could retaliate against any Brazilian response and is preparing to move cautiously. Officials close to Lula told the newspaper that Brazil is dealing with a more powerful trade partner and must choose carefully which sectors, if any, to pressure.

The law, approved by Brazil’s Congress last year, allows the government to respond to foreign trade measures that harm Brazilian competitiveness. It gives Camex, the Foreign Trade Chamber linked to the Ministry of Development, Industry, Trade and Services, power to suspend trade and investment concessions in response to countries or economic blocs that impose damaging measures on Brazilian products.

But the mechanism cannot be triggered immediately. Under the law, Brazil must first seek direct negotiations with the country or bloc responsible for the measures. It must also appeal to multilateral bodies such as the World Trade Organization. If those efforts fail, any retaliatory measures must be proportional to the economic damage suffered.

Officials said the pace of any response will depend on consultations with the economic sectors affected by the U.S. tariffs and on how those sectors assess the risks. The government does not want to rush the process or react emotionally, according to O Globo’s single-source reporting. Lula’s advisers also believe the United States may be waiting for a Brazilian misstep that could shift responsibility for the tariff dispute onto Brazil.

Vice President Geraldo Alckmin said Thursday that Brazil would apply the reciprocity law “at the appropriate time.” He stressed that the measure was not, in the government’s view, retaliation, but a legal instrument to defend national interests and the Brazilian economy.

“We have a reciprocity law approved unanimously by Congress, and the government, at the appropriate time, will know how to implement it,” Alckmin said at a press conference, according to O Globo.

Dario Durigan, the executive secretary at the Finance Ministry, said the government would bring the reopening of the reciprocity process to Lula, who would then provide guidance.

The law allows Camex to restrict imports, suspend concessions, patents or royalty payments, and apply additional taxes against countries targeted by Brazil’s response. The government’s central calculation is whether using those tools would strengthen Brazil’s negotiating position or invite a broader trade confrontation with Washington.